Via Joel Sherman, the Yankees are “almost certain” to trade either Chad Gaudin or Sergio Mitre before Opening Day given the team’s depth at the back of the rotation. He mentions that the Diamondbacks – who have Ian Kennedy penciled in as their number three starter at the moment – are looking for rotation help, but I’ll add the Mets and Dodgers to the mix as well. Both Gaudin and Mitre and out of options, so they would have to clear waivers to be sent to the minors, which won’t happen. Trading them is clearly the way to go.

At a $2.95M salary for 2010, Gaudin makes more than three times as much as Mitre. He’ll also be a free agent after the season, while Mitre still has another season of arbitration eligibility coming to him. Mitre has been better this spring and is opening some eyes, but I’d look to deal him over Gaudin without thinking twice. There’s nothing in his track record to suggest he’s a better pitcher, while Gaudin has proven to be a league average AL pitcher (101 ERA+ in 463.2 IP in the AL) with a strikeout rate that has improved three straight years to the point of nearly one per inning. Neither player is going to fetch much in a trade, a Grade-C prospect at best, so I’d certainly keep the guy that would be more useful to the Yankees this season.

Via Joel Sherman, the Yankees have a meeting planned for this Sunday to discuss the fifth starter situation. The prevailing thought seems to be that Phil Hughes is at the front of the line for the job, sending Joba Chamberlain back to the bullpen, but I can’t imagine that the brain trust is going to base the decision on each player’s first three Spring Training appearances if it is in fact a true “open competition.” Stranger things have happened, I guess.

Either way, there might be some progress towards a resolution with this mess situation soon, and Mo knows we’re all looking forward to it. Maybe they’ll talk about the trade partner they found for Sergio Mitre following his strong exhibition season. Wishful thinking?

The feeling around Tampa is that the lineup the Yankees trot out in tonight’s exhibition game will be the one Joe Girardi hands to the umpires on Opening Day. That marks one of the team’s more significant decisions this spring. As we’ve been saying since the outset, if the batting order represents a major decision the team is probably in good shape. After this the Yankees have just a few decisions to make, and only two that will actually affect who stays on the major league roster.

Fifth starter and bullpen

The most discussed position battle this spring has been for the last spot in the rotation. The Yankees insist that all five participants have an equal shot at winning, but that’s what they’re telling the public. Chances are either Joba Chamberlain or Phil Hughes will pitch behind Javy Vazquez, with the others moving to the bullpen. The Yankees know that they’ll need to replace one or both of Vazquez and Andy Pettitte next season, so having at least one of their highly touted youngsters ready to step in would be to their benefit.

Yet the battle doesn’t quite end there. This battle will see four losers, but there remain only three spots in the Yankees’ seven-man bullpen. Mariano Rivera, Damaso Marte, Chan Ho Park, and David Robertson already have spots, so there isn’t enough room for Al Aceves, Chad Gaudin, Sergio Mitre, and one of Joba and Hughes. This means that, one way or another, the Yankees will have to make a roster move. That might be trading Mitre, though there’s no guarantee they can find an acceptable suitor. Otherwise, it means optioning a player.

Of the eight bullpen suitors, only Joba/Hughes, Aceves, and Robertson have options. There’s almost no chance Robertson heads to AAA, so that leaves only two choices. The Yankees could send the either Joba or Hughes to the minors to remain stretched out, but they would also fit well in the bullpen. Sending Aceves down also appears to be a waste. They’ll have to pick one, though, since it remains unlikely that they’d actually DFA one of these players.

Photo credit: Gene J. Puskar/AP

25th man

The bench won’t be an issue for the Yankees heading into the season. Francisco Cervelli will back up Jorge Posada, Randy Winn will play the part of fourth outfielder, and Ramiro Pena figures to fill the utility role. That leaves just one spot open, and the Yankees have their battle between two players, Jamie Hoffmann and Marcus Thames. It won’t be an easy decision for the Yanks, either way.

This battle isn’t a matter of picking a winner and sending the loser to AAA. Either Thames or Hoffmann will end up elsewhere if he does not make the team. The Yankees must offer Hoffmann, a Rule 5 pick, back to the Dodgers if he does not make the 25-man roster. Perhaps at that point the two teams can work out a trade — maybe even a Mitre-for-Hoffmann swap — that would allow the Yankees to retain Hoffmann and place him in AAA. Chances are, the Dodgers would not refuse the Yankees’ offer of return.

When Thames signed with the Yankees he knew there was a chance he wouldn’t make the team out of spring training. In fact, with Hoffmann on board it would have made sense for the team to start the season with him in the majors and send Thames to AAA, where he could get at-bats while waiting for an opportunity. Seeing this in his future, Thames negotiated an opt-out clause in his contract that allows him to become a free agent if he does not make the 25-man roster. He could, of course, still end up playing for Scranton if no other teams shows interest. Those chances, however, don’t appear strong.

Photo credit: Kathy Willens/AP

Watch them tumble

The Yankees will likely keep a number of pitchers on staff through the end of spring training. The regulars won’t be completely stretched out, and there’s always a need to fill garbage innings when a pitcher gets hammered. But, while we might see guys like Jon Albaladejo and Romulo Sanchez still pitching in big league camp during the last week of March, there’s little to no chance they make the big league team. The Yanks have plenty of depth, to the point where they might have to option a good pitcher and release quality bench fodder. Thankfully, this is nothing but good news.

Via Chad Jennings, the Yankees agreed to deals with both Chad Gaudin and Boone Logan today, avoiding arbitration with both. Marc Carig says that Gaudin is getting $2.95M plus incentives, Logan $590,000. All of the Yankees arbitration cases are now resolved, and all of the offseason work is basically wrapped up.

I tackled a potential Gaudin deal earlier today, and I had planned to do the same for Logan later tonight. However, since the Yanks’ impatiently announced his deal today, I’ll just include what I had written after the jump. Enjoy.

Aside from finding an ever-elusive left field upgrade, the only matter of business left for the Yankees this offseason is to settle on contracts with Chad Gaudin and Boone Logan, both of whom are eligible for salary arbitration. Logan is eligible for the first time, but this is Gaudin’s third crack at arbitration, and after the season he’ll hit free agency for the second time of his career (the Cubs released him last April after giving him $2M).

Both the team and player (that means Gaudin or any other player in the league eligible for arb) have to submit their proposed salary figures for next season by tomorrow, though they could agree to a deal any time before a hearing, which would occur during the first week of February. In most cases the two sides will meet in the middle and go on their merry way, however sometimes they can’t reach an agreement and a hearing is necessary. Two years ago, the Yankees were unable to come to a compromise with Chien-Ming Wang. The Yanks won the hearing and saved themselves not only $600,000 for the 2008 season, but the carry over effect saved them even more money in 2009.

The three-person arb panels will pick between one of two salaries: the figure the team submits, or the figure the player submits. They can’t pick something in the middle. Both sides will try to justify their submitted salaries by comparing the player to other players with similar service time, not just other players in general. Gaudin has five years of service time, so he’s going to be compared to other pitchers when they had five years of service time. The people on the arb panel are not baseball experts at all, they’re professional arbitrators who will weigh the arguments presented to them as they see fit. Because of this, neither side will use advanced stats to make their point, instead they’ll rely on the old stand-bys of wins, ERA, strikeouts, walks, maybe WHIP, stuff like that.

After some digging, I found a handful of pitchers who were statistically comparable to Gaudin when they had five years of service time. Let’s tabulate…

(click for a larger view)

These aren’t perfect comparisons obviously, however they’re close enough for this blogger. All four had worked both as a starter and reliever early in their career, and all but one (Benoit) had bounced around between a few teams. Let’s see how much these guys got paid when they reached their third year of arb…

* Arb-2 is salary in second arb eligible year, Arb-3 is third arb eligible year. But you knew that already.

Okay, so this wasn’t as much of a help as I expected to be. I was hoping that they had all received similar raises, like 50-75% or something, but apparently not. It’s worth noting that both Wellemeyer and Correia were coming off career years, and that Benoit was bound by a two year contract extension he signed prior to his second year of arb eligibility. It’s still a valid comparison because of the amount of service time he had.

Instead of focusing on how big of a raise each player received, let’s take a look at how much money they ended up making in their last year before becoming free agents, like Gaudin is now. Both Benoit and Correia pulled in three-and-a-half million or so, and if you average all four players out, you get a $3.1M salary. We’ve been saying all winter that Gaudin will probably earn about $3M next season, though that was nothing more than a gut feel and estimate. At least now we have some basis for comparison.

Three million bucks or so will get you just under a win on the free agent market. CHONE projects Gaudin as a 2.1 win player next year, though that’s assuming he makes 28 starts. If he does that in 2010, either disaster has struck the Yankees’ pitching staff or he’s pitching for another team. More realistically, Gaudin would be a 0.8 WAR player if he throws 40 IP with a 5.00 ERA as a starter then another 60 IP with a 4.00 ERA as a reliever. $3.1M for 0.8 WAR is basically breaking even. Is Gaudin capable of pitching like that? Maybe, maybe not. It’s possible I’m overstating his abilities.

The Yankees overpay for a lot of things, and chances are they’ll be overpaying for Chad Gaudin in 2010. The team has reached the point where a marginal win has an almost negligible effect on the big picture, and I’m certain the team has an appropriate amount of the budget allocated for Gaudin’s 2010 salary.

Via Bryan Hoch, both Chad Gaudin and Boone Logan filed for salary arbitration today, which is the deadline to do so. Filing for arb is just a formality, and the two sides will exchange salary figures on Tuesday. Hearings start in February, though they can agree to a deal anytime before that.

The Yanks came into the offseason with five players eligible for salary arbitration, however Chien-Ming Wang was non-tendered, Brian Bruney and Melky Cabrera were traded away, and Sergio Mitre re-upped for $850,000.

Today begins the filing period for salary arbitration hearings, which means the start of a tedious process for players and teams. Once a player files, he and the team must exchange figures by January 19 in anticipation of a February hearing. For the next month plus, teams and players will negotiate for what each considers a fair salary. If they reach no such agreement they present cases in front of an arbiter, who will then choose either the team’s or the player’s proposed salary. In other words, once you get to a hearing there’s no longer a chance for compromise. It’s either one or the other.

Partly because of this all or nothing nature, most cases never go to a hearing. In fact, as Craig Calcaterra notes, 90 percent settle. This has left, since the inception of arbitration in 1974, just 487 hearings, or about 14 per season. It seems like that number has come down in recent years, too, perhaps because of the imbalance in decisions. Teams have won 57 percent of hearings, and while that’s not a huge margin, it does give a player an incentive to settle.

At MLB.com Anthony Castrovince describes the history of arbitration and how it has evolved since its inception in the early 70s. Back then it was a way to better reward players for their contributions while still preventing them from becoming free agents. Over the years, players continued to push the limits higher, gaining better and better compensation in arbitration. A handful of cases in each decade stand out, but none quite like Ryan Howard’s $10 million in 2008. The next year, arbitration eligible players received average raises of 172 percent. While free agent salaries trend downward, arbitration salaries continue to rise.

Given the perils of facing an arbitration hearing, chances are the Yankees will settle with both of their arbitration cases, Chad Gaudin and Sergio Mitre. Neither pitcher had a standout 2009, and the Yankees will likely use that to their advantage in negotiations. Mitre’s poor statistics almost force him to settle. Gaudin and his agent will likely concentrate on his numbers while with the Yankees (42 IP, 3.43 ERA), so maybe he has more of a case. But given Gaudin’s 2009 salary, $2 million, and his season-long performance, I’m not sure he can expect too hefty a raise. This could keep the two parties’ proposals close together, making it easier to strike a compromise.